TMA Analyzes Federal Changes for Texas Physicians
By Phil West

While many provisions in Congress’ budget bill, known as the One Big Beautiful Bill Act (OBBBA), won’t take effect until 2027, the Texas Medical Association is already at work analyzing what the new provisions mean for Texas physicians with one major theme emerging so far:  

By not adopting and implementing Medicaid expansion, Texas won’t be impacted the same way many other states will, says TMA President Jayesh “Jay” Shah, MD, also citing TMA’s successful advocacy during the Texas Legislature’s 2025 regular session to prevent any rollbacks to Medicaid payment rates and coverage.  

At the same time, Dr. Shah points to potential areas of opportunity TMA is monitoring within OBBBA to expand access to care, for example via new avenues aiming to improve rural health and direct primary care.  

“The key thing is to educate physicians about what’s coming so they are prepared,” he said regarding TMA’s role as its analysis continues. 

TMA staff point out that in Texas, eligibility for Medicaid is largely geared toward low-income children and pregnant women with household incomes of about twice the federal poverty level, as well as seniors and individuals with disabilities who meet certain income or medical needs-based criteria.  

TMA’s initial OBBBA analysis shows while Medicaid expansion states could be significantly impacted by provisions in the legislation, Texas and the nine other states that chose not to adopt Medicaid expansion may not experience the level of impact as the other 40 states (plus the District of Columbia). For example, some policymakers are concerned about the heightened work requirement for Medicaid recipients, however, this provision applies solely to Medicaid expansion populations.  

Meanwhile, delayed implementation of a number of OBBBA provisions leaves time for the U.S. Department of Health and Human Services to issue rules and guidance, as well as for states to execute implementation strategies, TMA staff note. It’s possible, through lawsuits or future congressional actions, some elements could be modified.  

Here are several forthcoming Medicaid provisions TMA is evaluating that could impact Texas starting Jan. 1, 2027:  

• Per the Texas Health and Human Services Commission’s guidance, a qualified “Medicaid provider” can screen certain patients for “presumptive” Medicaid eligibility. Only qualified hospitals and other qualified entities may make presumptive eligibility determinations. Prior to OBBBA, presumptive eligibility allowed that patient to temporarily receive coverage for up to three months while their application is processed. That window will be narrowed to two months for non-expansion states like Texas, and just one month for expansion states, potentially impacting physician payment. 

• Changes to more hospital-centric provisions, such as restrictions on tax rates used to help finance Medicaid spending and on state-directed managed care payments used to cover services, are likely to have trickle down effects for Texas physicians and access to care. 

• Provisions seeking to enhance the accuracy of Medicaid enrollees’ reported addresses and increase the frequency of eligibility verifications, plus ensuring deceased individuals and deceased physicians do not remain enrolled. The Centers for Medicare & Medicaid Services (CMS) has emphasized these provisions are in line with OBBBA’s overarching goals to reduce fraud, waste, and abuse.

Beyond Medicaid, TMA continues to analyze additional changes under OBBBA as well as other federal developments on the immediate horizon for Texas physicians and their patients, including: 

• The impact of federal public health cuts on Texas. 

• The Affordable Care Act enhanced tax credits, which OBBBA did not extend and are set to expire at the end of 2025. Along with other OBBBA provisions that impact marketplace coverage, increase verification requirements, and shorten enrollment timelines, the changes are likely to affect how many Texans will remain insured. 

• The Rural Health Transformation Program, a new grant process created under OBBBA through which CMS will distribute $50 billion to the states over the next five years to address rural health needs. States may apply beginning in mid-September and awardees are expected to be announced by Dec. 31.  

• Beginning Jan. 1, 2026, changes impacting direct primary care arrangements could allow patients to pay for them via health savings accounts. 

• The temporary Medicare payment increase OBBBA authorized for 2026, along with a mixed bag of other proposals in next year’s Medicare physician fee schedule. 

Continue to read Texas Medicine Today for coverage of how these and other federal policies might impact health care in Texas and learn more about TMA’s federal advocacy efforts.